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Welding

How to Start a Welding Business and Succeed

min read

If you are interested in welding, you might have wondered whether you can turn your passion into your own welding business. 

Being your own boss, taking charge of your own future, and making money for yourself instead of someone else are all common reasons to go into business. Yet starting a welding business is not simply a matter of hanging up a sign and getting to work.

No matter how good you are at welding, you also need to consider the business challenges you will face. From getting the right licenses and certifications to deciding on a business structure and choosing insurance, the decisions you make at the beginning will determine the success of your business as a whole. 

Here’s what you need to know about starting your own welding business:

Welding Licenses and Certification

If you’re wondering how to start a welding business, some states, such as New York, require welders to first obtain a welding license. That being said, whether or not it’s required by law, becoming a certified welder can help you land more profitable welding projects. 

There are numerous agencies in the United States that certify welders, but if you are interested in owning a welding business, you may want to go with the American Welding Society (AWS).

There are 10 different certification categories, from Certified Welder to Senior Certified Welding Inspector. Each certification requires both a written exam and a practical exam, along with an application.

In addition, you will need to obtain an occupational license or business license from your state. Your city or county may also require specific paperwork. Regulations change frequently, so check with your local Small Business Development Center for the latest information.

Tax Forms and Business Structure Setup

One of the most important decisions you will make for your new welding business is your business structure. There are three main forms of small business ownership:

  • Sole Proprietorship: A sole proprietorship is the simplest choice for one-owner businesses. You can use your own name or file a DBA (doing business as) to register a business name with your state. You can conduct business under your own social security number or file for an EIN (employer identification number) from the IRS. You will use your personal tax return to deduct your business expenses and pay your business taxes. The major drawback, though, is that you may be held personally liable if your business is sued.
  • LLC: An LLC (limited liability company) is an easy option for businesses with two or more owners. It protects you from personal liability if your business faces a lawsuit, and it does not require a lot of complex paperwork. Your business profits and losses will “pass-through” to your personal tax returns.
  • S Corporation: Any LLC can elect to be treated as an S corporation. It requires some extra paperwork, but it also offers some tax benefits over an LLC.

Each company has unique needs, and choosing a business structure will have a long-term impact on your business. It’s important to get it right, so speak with your tax professional and your business attorney before deciding.

Your state’s official website, as well as the IRS Checklist for Starting a Business, can walk you through the steps of setting up your business structure. Refer to these documents frequently throughout the process to make sure you properly file all paperwork.

Insuring Your Business

Business insurance may not be at the forefront of your thoughts when starting your welding business, but it is absolutely essential to protecting your new company. Welding can be both messy and dangerous, and there is always a risk of things going terribly wrong.

Next Insurance provides the financial protection you need without adding out expensive products that aren’t right for you. There are customized welding insurance plans designed to meet the needs of small business owners in this specific industry. Also, plans start at just $29 per month, and they can grow with you as your company expands. Whether a client trips over your equipment and needs to visit urgent care, or sparks damage their favorite staircase, you can be confident that your business is protected.

If you are starting a mobile welding business, consider adding commercial auto insurance to your policy. Using your vehicle in the course of business is not generally covered by personal auto insurance, which could leave you on the hook for financial losses. We can bundle your commercial insurance into your welding insurance plan, ensuring full protection for your new mobile welding business.

Business and Marketing Plans

Business and marketing plans are essential for any small business, but many people have no idea how to create them. Fortunately, the stuffy, formal business plans of yesterday are no longer needed. Instead, think of them as tools to help your business grow.

To write your business plan, think about what your welding business currently is and what you want it to be. Do you want to start a fabrication shop? Are you interested in buying a truck and a trailer and offering mobile welding services? Do you plan to hire employees? How much cash do you have, and how much do you need for the next 12 months? The more specific you can be about your short-term and long-term goals, the more useful your business plan will be.

Although the marketing plan is part of the business plan, it can be helpful to write it separately. Think of your marketing plan as your guide to finding and keeping customers. Who is your target market? Are you interested in large commercial projects? Do you want to do smaller local work? How do your potential customers spend their time? Do they hang out at local events or on social media?

Try to figure out the psychology and behaviors of the customers you most want to attract. Then let that information guide your marketing plan. Maybe you should hand out your welding business cards in person, post ads on social media, or even sponsor a local event. Marketing your business doesn’t have to be a chore, as long as you put some initial work into identifying and finding your ideal customer.

Putting It All Together

Starting a welding business can be exciting, but there are important challenges to consider. 

Take it step by step, ensure that all your paperwork is in order, put together your business and marketing plans, and choose insurance to protect your new company. With some hard work, your business can truly be a success with profitable welding projects. 

 

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